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Investor presentation
Contents
• Aspocomp in brief
• Markets and growth drivers
• Competitive edge
• Financials
• Strategy
• Outlook
Appendix
2
3
Aspocomp - At the heart of your technology
Technological
advantage in
demandingprinted circuit
boards
Competitive
manufacturing
partnernetwork
Full life-cycle
from
R&D to
volumeproduction
High-tech
PCB
technologydesign, testing
and logistics
Listed on the
Nasdaq Helsinki
since 1999
Own high-tech
productionsite
in Finland
Shortening
Time-to-
market
Net sales
growth
22% (2018)
PCB = Printed circuit board
Aspocomp in brief
4
-8
-3
2
7
12
0
5
10
15
20
25
30
2015 2016 2017 2018 Jan.-Sep.2019
Net sales Operating profit
Operating profit, %
Net sales and profitability
EUR million
• Aspocomp develops and sells PCBs
and manufacturing services,
helping customers to create
optimal designs and shortening
time-to-market for customers’
products.
• Aspocomp offers cost-efficient
access to all PCB technologies
together with its own production
site in Oulu and strong partner
network.
%
Aspocomp - Serving customers worldwide
5
Market size
for PCB
$90 billionby 2024
(Sep. 2019,
Lucitel & Industry Arc)
Production site
in Oulu, Finland
Main markets Northern
and Central Europe
Global supply chain
with partner network
in Europe and China.
Customer support in
Europe.
Head office in
Espoo, Finland
Presence in Germany,
UK, Switzerland and
Sweden
Markets and growth drivers
Increasing use of PCBs in
electronic appliances
drive the industry.
6
A printed circuit board (PCB) is the principal interconnection method in electronic
devices. PCBs are used for electrical interconnection and as a component assembly
platform in most electronic applications. Aspocomp’s PCBs are used in many
applications, such as telecommunication networks and devices, automotive
electronics, security and medical systems, chipset development and industrial
automation.
Digitalization continues to
drive global growth for PCBs
• Industry growth driven by
digitalization especially in
vehicle automation,
instruments,
telecommunications infra,
security, defence &
aviation and advanced
semiconductor
technologies.
• Shortening time-to-market
increasingly critical
7
Connected devices, IoT
Industrial internet
Artificialintelligence
Robotics
Automation in vehicles
Tele-communications
infra, 5G
Market
growth
4.3%for PCB’s
2019-2024
(CAGR)*
DIGITALIZATION
* Source: Lucintel 9/2019
Market for PCBs growing along with smart devices,
telecom infra and automation
• Advancement of internet
of things
• Increased adoption of
smart devices
• Wearable electronics
• Telecommunications infra
and 5G
• Increased automation in
industrial applications
• Advancement in
automotive electronics
8
The PCB market is expected
to grow by 4.3% (CAGR)
from 2019 to 2024.*
Market size is expected to
reach $89.7 billion by
2024.*
However, some signs of
growth slowing down
are visible.
Also geopolitical
concerns, trade tariffs
and Brexit may have an
impact.
*Source: Lucintel Sep. 2019
Main market drivers for growth
In Europe average growth
rate 2.6% (CAGR) 2016-
2024*
Asia Pacific is expected to
remain the largest market
and witness the largest
growth *
Aspocomp’s competitive edge
Why customers love us?
10
Accelerate TIME-TO-MARKET
of our customers’ products
Bringing added value to customers by
providing PCB technology services from the
R&D phase to volume production.
Focus on customers’ concerns
Complex technical PCB
requirements
Need for a reliable
PCB partner who
can support them in all
technologies and volumes
Critical time requirements
We have
1) Superb technology and
manufacturing knowledge
from design to production
2) Strong world-class
partner network and own
production
3) Fast deliveries, flexibility in
operations
4) Certified quality standards
12
Customers have
10.3.2020
Key Customer Segments for Aspocomp
SEMICONDUCTOR
R&D AND
IC TESTING
SECURITY &
DEFENCE
INDUSTRIAL
ELECTRONICS
AUTOMOTIVE
TELECOMMUNICATION
INFRASTRUCTURE
Aspocomp’s key strengths
14
Wide technology portfolio
Own production in Oulu, Finland
Strong partners and
local organization
in Europe and Asia
Engineering support and
customer service
Most challenging designs within the shortest lead-times of the industry.
World-class know-how, dedicated personnel, and capabilities for industrial scale prototyping.
Flexible production facilities and stocking system enable to quickly adapt to changes
Complete product palette
from most demanding to
basic PCBs according to
customers needs.
Competitive and reliable partner network.
Long presence in Asia.
Local presence in EU countries
Comprehensive engineering support for R&D in Oulu.
Single contact point for customer service.
Logistic advantage for customers in Europe.
ISO standardized production.
Committed to adding value by serving our
customers with superior PCB expertise
Aspocomp today
15
Our strategy Our targets
High-technology
expertise for
demanding PCBs
Own production
facility in Finland
and strong partner
network
Serving customers
by both special and
volume PCBs
Expand services to
cover PCB needs over
the product’s entire
life cycle
Shorten time-to-market
with fast deliveries
Optimize efficiency
Growth
Number
one
partner for
our
customers
Financials
Strong growth and profitability
Growth continued – transformation
strategy successfully implemented
17
0
5
10
15
20
25
30
2015 2016 2017 2018 1-9/2019
EUR million
• Net sales increased by 12% y-o-y driven by strong demand for products
• Both net sales and profitability showed double digit growth
• Profitability remained at a good level
• Order book significantly strengthened
NET SALESEBITDA EBIT
0
0,5
1
1,5
2
2,5
3
3,5
4
2015 2016 2017 2018 1-9/2019
EUR million
-2,5
-1,5
-0,5
0,5
1,5
2,5
3,5
2015 2016 2017 2018 1-9/2019
EUR million
Strong financial position,
equity ratio at 63.4%
18
0
10
20
30
40
50
60
70
80
2015 2016 2017 2018 1-9/2019
• Operative cash flow significantly increased to EUR 4.9m
• Gearing remained at a good level at 19.3%
EQUITY RATIO, % CASH FLOW FROM OPERATIONS
0
1
2
3
4
5
2015 2016 2017 2018 1-9/2019
EUR million
1-9/2019
Equity per share
€2.50
Earnings per share
€0.40
Investments of EUR 10 million in total
in Oulu site progressing as planned
• On-going investments in Oulu to respond to the increased demand, in the first stage, to enhance the capability and, in the second stage, to increase the capacity – with the aim to optimize the product mix.
• Most part of the first stageinvestment will be completed by endof 2019.
• The investment is partially funded by EU 2014-2020 program.
• In 2018, investments included the acquisition of the production facilityin Oulu.
19
INVESTMENTS
0
0,5
1
1,5
2
2,5
3
3,5
4
2015 2016 2017 2018 1-9/2019
EUR million
Key drivers for performance
✓ Volumes increased in bothR&D and volumeproduction
✓ Improved efficiency
✓ Improved product mix
➢ Long lead times of materials
➢ Geopolitical concerns
➢ European market slowing
20
EUR million%
-8
-3
2
7
12
0
5
10
15
20
25
30
2015 2016 2017 2018 Jan.-Sep.2019
Net sales Operating profit
Operating profit, %
Net sales and profitability of Aspocomp
Quarterly performance
21
EUR million%
0
2
4
6
8
10
12
14
16
18
0
1
2
3
4
5
6
7
8
9
10
9-12/2017 1-3/2018 4-6/2018 7-9/2018 9-12/2018 1-3/2019 4-6/2019 7-9/2019
Net sales Operating profit Operating profit, %
Quarterly net sales and profitability of Aspocomp
Key indicators
EUR million 1-9/2019 2018 2017
Net sales 23.0 29.1 23.9
EBITDA 3.7 4.0 1.9
Operating profit (EBIT) 2.7 2.9 0.8
% of net sales 11.9% 9.9% 3.5%
Net profit for the period 2.7 3.2 1.3
Earnings per share, EUR 0.40 0.49 0.19
Operative cash flow 4.9 2.0 0.8
Equity ratio, % 63% 57.6% 69.1%
Order book at the end of
the period4.9 2.8 2.5
Personnel 122 117 111
22
• Net sales grew by
12%
• Profitability
improved
significantly,
operating profit
margin 11.9%
• Operative cash flow
of EUR 4.9 million,
more than doubled
y-o-y
• Order book at a
record level at
EUR 4.9 million
27
39
18
9
7
0
28
33
19
13
5
2
Automotive
TelecommunicationInfrastructure
Industrial Electronics
Security & Defence
Semiconductor R&Dand IC testing
Other
0 20 40 60 80
Sales by customer sectors, %
23
Finland
Europe (exl.Finland)
Asia
Others
0 50 100
Sales by geographical area, %
2017
2018
Telecommunication infrastructure
continues as the largest customer sector
Mitigating business risks
Dependence on keycustomers
Short order intake, typically1-3 months in the PCB industry
Changes in market trends
Availability of materials
➢ Aim to increase the number of largecustomers. In 2018 the five largest customers accounted for 54% (51% in 2017) of net sales.
➢ Aim to increase the number of customers and customer segments. Strengthen long-term customer relations.
➢ Own production site helps to adapt to market changes.
➢ Stock availability, pre-orders, and merchant stock are usedto anticipate changes in materialavailability.
24
Integrating
sustainabilityin our operations
Profitable, responsible and long-term
business growth is our goal
• We are committed to good governance, in accordance with the
legislation, the company's Articles of Association and the Finnish
Corporate Governance Code.
26
Social
responsibility
Environment
Governance
• Our Code of Conduct defines the basic requirements of our business
practices and guides our employees to act responsibly in their daily
work.
• Our business is in line with the Social Accountability International
SA8000 standard.
• We have a conflict mineral policy
• Our production plant and manufacturing partners have ISO 14001-
certified environmental management systems and related action plans.
• We operate in accordance with the European Union’s REACH
Regulation.
• Our products meet the requirements of the lead-free soldering process
and our raw material options include halogen-free base materials.
• We can provide our customers with detailed material reports.
27
Growth strategy
To be the number one partner for our customers.
Main Topics in current Strategy
• Aspocomp – Customer Oriented Service Company
• Seeking for high growth in selected customer segments
• Expanding to new markets
• Improve operational exellence
• Target to grow in average of 10% annually and to reach
minimum profitability of 7% latest in year 2022
14.3.2017 Capital Markets Day28
Aspocomp – Customer Oriented
Service Company
• Supports and offers Customer’s all PCB needsthroughout the whole lifecycle of the products
• Strong vision and knowhow in PCB technologies
– High techology and delivery performance in operations
• Wide product and technology offering
– Competitive Partner network
• Customer Service: Best in Class
– Wide network in Customer organization (R&D, Sourcing, Operations, Management)
14.3.2017 Capital Markets Day29
Megatrends driving our Customer
Segments
– TelecommunicationNetworks
– Automotive
– Industrial Electronics
– Security- and Defence
– SemiconductorComponets Testing
5G technology
ADAS- systems
IOT, AI, Robotics
Geopolitical situation
Moore’s law
Nov 2019 Confidential
Seeking for high growth in selected
customer segments
14.3.2017 Capital Markets Day31
19 %
64%
11 %
8 %
2015
Automotive
Telecommunication Infrastructure
Industrial Electronics
Other
27 %
39 %
18 %
9 %7 %
2018
Automotive
Telecommunication Infrastructure
Industrial Electronics
Security & Defence
Semiconductor R&D and IC testing
11,7 M€, 67%
• Oulu manufacturing focus
on technologially
advanced products
• Standard products moved
to partners
• 2018-9 investments
focused on capability
improvements. Next step
is to increase the
capacity.
• Target to increase Oulu
revenue by 50%
14.3.2017 Capital Markets Day32
2015 2016 2017 2018
Average Selling Price, Oulu facility ASP, €/m2
Increasing share of value added
products in Oulu , ASP increased 14% in
2017- 2018
Management Team
33
Mikko
Montonen
Chief
Executive
Officer
Jari
Isoaho
Chief
Operating
Officer
Jouni
Kinnunen
Chief
Financial
Officer
Mitri
Mattila
Chief
Technology
Officer
Antti
Ojala
Business
Develop-
ment
Ari
Beilinson
Sales and
Marketing
Outlook for 2019
14.3.2017 Capital Markets Day34
• In 2019, net sales are expected to grow approximately 10 percent
compared with 2018 and the operating result to be better than in
2018.
• In 2018, net sales amounted to EUR 29.1 million and the operating
result to EUR 2.9 million.
Why to invest in Aspocomp
35
Profitable growthGrowing market for PCB
Superior technical
expertise
Focus on
more comprehensive
customer service
Becoming the
number one
partner for our
customers
Disclaimer
• Although forward-looking statements contained in this
presentation are based upon what management of the
company believes are reasonable assumptions, there can be
no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. These
statements are not guarantees of future performance and
undue reliance should not be placed on them. The company
undertakes no obligation to update forward-looking
statements if circumstances or management’s estimates or
opinions should change except as required by applicable
securities laws.
36
Thank you
APPENDIX
Income statement
EUR million 1-9/2019 2018
Net sales 23.0 29.1
Other operating income 0.1 0.0
Materials and services -10.4 -13.2
Personnel expenses -5.5 -7.7
Other operating costs -3.5 -4.3
Depreciations and amortization -1.0 -1.1
Operating result 2.7 2.9
Financial income and expenses -0.1 -0.1
Profit/loss before tax 2.7 2.7
Income taxes 0.0 0.5
Profit/loss for the period 2.7 3.2
39
Balance sheet
EUR million Sep. 30, 2019 Dec 31, 2018
Assets
Non-current assets
Intangible assets 3.2 3.3
Tangible assets 6.0 4.9
Available for sale investments 0.0 0.0
Deferred income tax assets 4.0 4.0
Total non-current assets 13.2 12.2
Total current assets 13.2 13.6
Total assets 26.4 25.8
Equity and liabilities
Total equity 16.8 14.9
Total liabilities 9.7 11.0
Total equity and liabilities 26.4 25.8
40
Cash flow
EUR million 1-9/2019 2018
Profit for the period 2.7 3.2
Adjustments 0.1 0.7
Change in working capital 1.4 -1.8
Received Interest income 0.0 0.0
Paid interest expenses -0.0 -0.1
Paid taxes 0.0 0.0
Cash flow from operating activities 4.9 2.0
Investments -2.2 -3.4
Proceeds from sale of property, plant and equipment 0.1 0.0
Cash flow from investing activities -2.1 -3.3
Increase in financing 0.0 4.6
Decrease in financing -1.0 -0.6
Dividends paid -0.8 -0.5
Cash flow from financing activities -1.8 3.5
Cash and cash equivalents at the end of period 3.5 2.6
41
Aspocomp’s share price performance
42
DIVIDEND POLICY
The company’s aim is to pay an annual dividend to its shareholders.
In its annual proposal on the distribution of dividend, the Board will take into account the company’s financial performance, investment and development needs, and solvency.
The targeted dividend payout ratio is at least one-third of the group’s profit for the financial year.
Shareholders as of Sep. 30, 2019
Shareholders by sector
Households 53.3%
Companies 34.2%
Financial and insurance institutions 12.0%
Non-domestic organizations 0.4%
Non-profit organizations 0.1%
Shareholders Shares Owner-
ship, %
1 Tiiviste-Group Oy 1,001,004 14.93%
2 Joensuun kauppa ja kone Oy 745,000 11.11%
3 Mandatum
Henkivakuutusosakeyhtiö
328,861 4.91%
4 Etola Erkki 295,000 4.40%
5 Montonen Mikko 260,000 3.88%
6 K22 Finance Oy 235,000 3.51%
7 Lähdesmäki Tuomo 163,000 2.43%
8 Lahdenperä Matti 150,000 2.24%
9 Svenska Handelsbanken AB
(Hall. Rek.)
136,437 2.04%
10 Nordea Henkivakuutus Suomi
Oy
135,000 2.01%
Total 10 largest 3,458,302 51.55%
Total number of shares 6,704,505 100%
43